Carbon Emission Effect Of China’s Direct Investment In Belt And Road Countries

Although Belt and Road countries have gained great support from China in terms of investment,have improved their infrastructure conditions,and have improved their economic development level,some countries distort the motivation and investment behavior of China,accuse China of taking the Belt and Road Initiative to transfer backward production capacity and pollution,and even regard the Belt and Road Initiative’s motivation as a resource grab.Does China’s outward foreign direct investment(OFDI)directly lead to the increase of Belt and Road countries’ carbon emissions?How does China’s OFDI indirectly affect Belt and Road countries’ carbon emission scale through economic growth,industrial structure and technological level?What are the differences in the carbon emission effects of China’s OFDI among countries with different income levels?Determining the impact path of China’s OFDI on carbon dioxide emissions not only plays an important role in Belt and Road countries’effective use of China’s OFDI to achieve sustainable development,but also is conducive to the continuous promotion of the BRI.A flood of literature has explored the direct impact of FDI inflow on CO2 by applying the linear model to assume the linear relationship between FDI inflow and CO2.However,little attention has been paid to the indirect dynamic effect of FDI inflow on carbon dioxide emissions.In order to make up for this research gap,based on the data data of 45 BRI countries from 2003 to 2017,the paper applies the PSTR model with dynamic and threshold characteristics to study the direct and indirect effects,linear effects and non-linear effects of China’s OFDI inflow onCO2 emissions.This paper also estimates the nonlinear relationship between China’s OFDI and carbon emissions of relatively high-income countries and relatively low-income countries to explore the difference of carbon emission effect between economic anti gradient investment and economic pro gradient investment.The results show that,first,in the whole sample,the direct impact of China’s OFDI on CO2 emissions of BRI countries is significantly negative,its structural and technical effects can further inhibit CO2 emissions,and the scale effect promotes the increase of CO2 emissions.Second,for relatively high-income countries,China’s OFDI will directly lead to the increase of carbon emissions of the host country in a low state,but the direct effect will be significantly reduced in a high state,and the technical effect of China’s OFDI is significantly positive.Third,China’s OFDI has no statistical significance in terms of scale effect and structure effect on relatively low-income countries.In addition,economic growth has a positive impact on CO2 emissions.The increase in industrial output and energy intensity will lead to a rapid increase in carbon dioxide at the beginning.With the inflow of OFDI in China,the increase in carbon dioxide emissions will slow down.This paper puts forward the following policy implications:First,China should continue to increase OFDI to BRI countries to achieve win-win cooperation;Secondly,Belt and Road countries should actively absorb FDI from China and exert FDI technology spillover effect;Finally,while pursuing economic growth,Belt and Road countries need to focus on developing green technology,optimizing energy efficiency and energy consumption structure,and promoting sustainable economic development.